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Reddit turmoil creates complications for marketers

Reddit bills itself as the ”front page of the Internet” and with nearly 170m unique visitors each month, it has become an increasingly attractive target for marketers.

But can marketers look past the company’s ongoing internal struggles?

Reddit doesn’t look much like Facebook, Twitter or SnapChat, and its ad offerings aren’t nearly as robust. But what Reddit lacks in polish, it makes up for in engagement. For instance, according to a study conducted by ShareThis, the lucrative target market of gamers are twice as active on Reddit.

But Reddit users and management are battling to determine the direction of the site and the fight has become an ugly public spectacle that threatens the company’s viability as a marketing platform.

As CNBC’s Michelle Castillo observes, ads on Reddit, which can come in the form of promoted posts, are often inexpensive compared to other social platforms. While that might be a reflection of Reddit’s audience, which can be hostile to certain brands and types of promoted posts, the risk-reward proposition is attractive to some marketers.

The chaos at Reddit however, which has included the resignation of its CEO and interesting claims by the company’s former CEO, could derail the company’s efforts to grow its ad business just as it was starting to attract broader interest from marketers.

Some suggest the current situation won’t really bother the marketers for whom Reddit is a good fit. ”For brands that see this and are spooked off, and I’m sure many will be, it might not have been right for them [in the first place],” Mike Dossett of ad agency RPA told CNBC.

But that might be oversimplifying matters. Many of the issues the Reddit users and management are debating, such as censorship and harassment, will shape the type of community Reddit becomes in the future, and thus how friendly and appealing it is to marketers.

If Reddit goes too far in one direction, many marketers might feel uncomfortable being a part of the community. If Reddit goes too far in the other direction, it could conceivably lose its community, making the site a less attractive platform for marketing.

Unfortunately for Reddit, negotiating a balance that works for its passionate and diverse user base, as well as the marketers it is trying to court, could prove to be a very difficult task.

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